Arch Capital Group Ltd. (NASDAQ: ACGL) has reported its 2025 fourth quarter results, showcasing significant growth and impressive financial performance. The company's net income available to Arch common shareholders increased to $1.2 billion, or $3.35 per share, representing a 21.2% annualized net income return on average common equity, compared to $925 million, or $2.42 per share, for the 2024 fourth quarter.
Furthermore, after-tax operating income available to Arch common shareholders jumped to $1.1 billion, or $2.98 per share, representing an 18.9% annualized operating return on average common equity, compared to $866 million, or $2.26 per share, for the 2024 fourth quarter.
The company's book value per common share also saw a 4.5% increase to $65.11 at December 31, 2025, compared to the previous quarter.
In terms of underwriting results, the company reported gross premiums written at $4,809 million, net premiums written at $3,649 million, and net premiums earned at $4,255 million, signifying a 1.1%, 4.5%, and 2.7% change respectively from the 2024 fourth quarter.
The underwriting income surged to $827 million, reflecting a remarkable 32.3% change from the 2024 fourth quarter. Additionally, the combined ratio excluding catastrophic activity and prior year development stood at 79.5%, compared to 79.0% for the 2024 fourth quarter.
Segment-wise, the insurance segment's underwriting income soared to $119 million, depicting a substantial 296.7% change from the 2024 fourth quarter. The reinsurance segment's underwriting income also experienced a significant increase to $458 million, marking a 39.6% change from the 2024 fourth quarter.
Notably, the mortgage segment reported underwriting income of $250 million, reflecting a 6.4% decrease from the 2024 fourth quarter.
Furthermore, the company's pre-tax net investment income amounted to $434 million for the 2025 fourth quarter, showing a 6.7% growth from the 2024 fourth quarter. The net realized gains for the quarter were $22 million, compared to a net realized loss of $161 million in the 2024 fourth quarter.
The company's effective tax rate on income before income taxes was 14.5% for the 2025 fourth quarter, compared to 6.6% for the 2024 fourth quarter.
The market has reacted to these announcements by moving the company's shares -0.32% to a price of $90.65. If you want to know more, read the company's complete 8-K report here.
